There is no one-size-fits-all best strategy for raising startup capital. Each business has its own unique needs and structure that every entrepreneur should consider. It would be impossible to address all the specific circumstances we’ve seen in companies raising capital at Mutual Capital Partnersto include in just one article. However, there are a few things that any entrepreneur considering raising capital needs to think about.

What are your goals?

The most important question you must answer before raising any capital is to ask yourself what are your goals with the business?

Is it to own a business that will support your lifestyle? Is it something you want to create that you can pass down through multiple generations of your family? Is it something you want to grow quickly and then exit quickly? How you answer will dictate the kind of funding options you pursue as well as your overall business strategy.

With that answer in hand — for yourself and for any of your current business partners — you can start to create a financial plan. You need to model out how any capital coming into the business will affect it.

How much more inventory can you buy? How many salespeople can you hire? How many new locations can you open?

Understand how that will help to grow your business and what a reasonable amount of capital is that helps you to hit the next milestone you are targeting. For example, if you want to have $1 million of revenue, how many salespeople have to be selling your product? How much will it cost to employ them? Once you do the math, you’ll understand how much capital you should be seeking.

Armed with the strategy of your business for the future and a detailed plan for how much capital you need and how you will use it, you will be able to evaluate different funding options that make sense for your business.

If you plan to have a lifestyle or family business, explore non-dilutive funding options that allow you to keep control of the business and require low/no return on investment.

Entrepreneurs looking to create high-growth businesses should also begin by looking at non-dilutive funding options.

Non-dilutive funding

Grants or business competitions are a great place to get capital to start a business without giving up equity while the business is still young. The best advice we can give to entrepreneurs is to bootstrap their business and preserve equity as long as possible. When it becomes apparent you are missing out on growth opportunities because of a lack of capital, you should start to target growth funding from angels or venture capitalists.

The stage of your business will dictate how much funding you can raise and who will give it to you. Oftentimes, entrepreneurs raise a small amount of funding from family and friends to get started, then raise angel money from local, individual investors. They target venture capital funding after they have taken a product to market and are ready to scale. Remember that every investor will have their own requirements on industry, stage and geography, so doing your homework before contacting them will save both of you a lot of time and effort.

As a business owner, you are the only one who can decide what is the right path for you and your company. If you have a clear vision and are able to partner with others who see your same vision, you’ll find great success.

How to reach: Mutual Capital Partners,

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 Wayne Wallace is a co-founder and Liz Todia is an analyst at Mutual Capital Partners. Wayne previously worked in investment banking for both McDonald Investments and National City Investments. Liz, a graduate of the University of Dayton, spent two years managing the Flyer Angels Fund, a $1 million seed investment fund investing in early-stage, Ohio-based technology companies.